Husqvarna AB: Interim Report January - September 2014

“Husqvarna Group’s positive trend from the first half year continued
into the seasonally smaller third quarter. Total Group sales increased
by 3%, adjusted for changes in exchange rates.

Operating income for the third quarter increased by 46% to SEK 301m
(206), and the margin rose to 4.4%, driven by improvements across all
business areas. On Group level, the favorable development was supported
by reduced material costs, higher sales volume and improved
productivity. Cash flow was solid, and the net debt/equity ratio
improved to 0.50 (0.57).

From a business area perspective, currency adjusted sales for Americas
and Construction increased by 6% respectively, while Europe &
Asia/Pacific was flat. In terms of earnings, Europe & Asia/Pacific
reported higher results and improved margin, Americas’ turn-around
showed steady progress reducing the operating loss in the quarter by
more than half, and Construction sustained its profitable growth.

As previously communicated, the Group’s current focus is to increase the
operating margin from approximately 5% in 2013 to 10% in 2016. On a
year-to-date basis, the operating margin has improved by close to 2
percentage points. The positive development has largely been enabled by
a successful execution of the Accelerated Improvement Program, which
primarily aims to cut product cost by reducing material costs, and
improve product mix by focusing on core brands and on products where the
Group has leadership positions.

We are now taking the final steps of preparing for next season. Keeping
the momentum in the execution of the Accelerated Improvement Program is
the priority for 2015. In parallel, the new brand based organization
will be fully operational as of January 1, 2015, and forms the base for
taking steps towards expansion beyond 2015.

From a short term demand perspective, we expect the fourth quarter to
show a stable development compared to the corresponding quarter prior
year.”

· Operating income increased 46% to SEK 301m (206). Sales, operating
income and margin improved for all business areas.

· Earnings per share increased to SEK 0.31 (0.16).

· Operating cash flow amounted to SEK 1,286 (2,001).

· The net debt/equity ratio improved to 0.50 (0.57).

Telephone conference

A combined press and telephone conference, hosted by Kai Wärn, President
and CEO, and Ulf Liljedahl, CFO, will be held at Husqvarna’s office on
Regeringsgatan 28 in Stockholm at 10:00 CET on October 22, 2014. To
participate by phone, please dial +46 (0) 8 5052 0110 (Sweden) or +44
(0)20 7162 0077 (UK) ten minutes prior to the start of the conference.
The conference call will also be audio cast live on www.husqvarnagroup.com/ir
(http://www.husqvarna.com/ir).
A replay will be available at www.husqvarnagroup.com/ir
(http://www.husqvarna.com/ir) later
the same day.

Husqvarna Group

Husqvarna Group is the world’s largest producer of outdoor power
products including robotic lawn mowers, garden tractors, chainsaws and
trimmers. The Group is also the European leader in consumer watering
products and one of the world leaders in cutting equipment and diamond
tools for the construction and stone industries. The Group’s products
and solutions are sold via dealers and retailers to both consumers and
professional users in more than 100 countries. Net sales in 2013
amounted to SEK 30 billion, and the Group had 14,000 employees on
average in more than 40 countries.

This interim report comprises information which Husqvarna is required to
disclose under the Securities Markets Act and/or the Financial
Instruments Trading Act. It was released for publication at 08:00 CET on
October 22, 2014.